What Happened

Silver Lake will buy an approximate $500-million minority stake in Credit Karma, making the company one of the most highly valued in fintech, as it puts the company's value at about $4 billion, according to WSJ.

Instead of Credit Karma receiving proceeds or issuing new shares, Silver Lake will collect common shares from early investors and employees, the report said. Credit Karma CEO Kenneth Lin told WSJ it's important for early investors to give its early backers an opportunity to take some money out of the company.

Why It's Important

Credit Karma's latest transaction implies an initial public offering is unlikely to happen until late 2019, WSJ said, citing a source who is familiar with the matter. The company's CEO did confirm it periodicially evaluates an IPO, but there is no existng timetable.

What's Next

As part of the deal, Silver Lake managing partner Mike Bingle will be given a seat at Credit Karma's board. He also holds a seat on Social Finance's board, another fintech firm in which Silver Lake is a partner.